Major French water policy reform launched

Voynet proposes new charging systems, taxes on detergents, pesticides, gravel extraction

French environment minister Dominique Voynet unveiled ambitious plans to reform the country's water laws on Wednesday, in a communication presented to cabinet colleagues. Under the plan, new water-related taxes will be introduced next year, followed by a reform of French water law in 2001.

The series of reforms put forward by the minister seek to reinforce the polluter pays principle in French water law and pricing as well as effectively transposing into national law the EU's water framework directive, even though this is still being debated by governments and the European Parliament

The taxes will be integrated into the general tax on polluting activities, or TGAP, which was introduced last year to bring together 17 existing environmental taxes under one umbrella (ENDS Daily 23 July 1998). New water-related taxes were promised in the environment ministry's draft budget for 2000, published last month (ENDS Daily 17 September).

Targets for the new taxes are detergents, especially those containing phosphates, which can cause eutrophication, or over-enrichment, of water bodies and rivers. The "most toxic" pesticides will also be taxed, as will be gravel extraction operations. In total, the three water-related taxes are projected to raise euros 152m (FFr1bn) in 2000, nearly one-third of the total expected for all TGAP taxes. Revenues will contribute to planned cuts in corporate taxes for firms that create jobs as a result of a new law imposing a maximum 35-hour working week.

In a second element of the plan, a system of water charging "more directed towards curing pollution than preventing it," in the words of Ms Voynet, is to be amended under a revision of existing French water law to be proposed in 2001. Consumer charges, which increased more than three-fold between 1991 and 1997, are to be stabilised. The minister is also proposing to clarify the charging system imposed by municipalities and to introduce mechanisms to encourage them to invest in more sophisticated water treatment equipment.

Meanwhile, industrial and agricultural users will have to pay more for water. In particular, farmers will have to pay fees for excess use of nitrogen fertilisers as well as for water use. Currently, agriculture contributes less than 1% of the budget of the national river basin water agencies, though farmers are the second largest consumers of water after the state electricity firm EDF. Nuclear plants will also be taxed as they increase water temperature.

Finally, Ms Voynet has proposed a "national fund for water solidarity" to finance common initiatives across France's six main river basins. A "high council" for public water services will also be created to arbitrate in disputes between municipalities and consumers.

Follow Up:
French environment ministry, tel: +33 1 42 19 20 21. References: Extensive information on the proposals is available on the ministry's web site.

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